When is an Action Terminated For Purposes of the Dragonetti Act
For lawyers in Pennsylvania, the Dragonetti Act (the codification of the common law tort of wrongful use of civil proceedings) holds a particular morbid fascination. There is nothing quite like having an old case come back to haunt you because the person you brought an action against thinks he or she should not have been involved in litigation. For defense attorneys it can also be a useful tool/weapon to try and end an action you believe has been brought without merit. Whether you are threatened with it by another party, or you wish to use it as a tool, it is important to understand the elements of this cause of action. This article addresses the first element of a wrongful use of civil proceedings claim.
Wrongful use of civil proceedings is codified at 42 Pa.C.S.A. § 8351. Section 8351 provides:
(a) A person who takes part in the procurement, initiation or continuation of civil proceedings against another is subject to liability to the other for wrongful use of civil proceedings:
(1) He acts in a grossly negligent manner or without probable cause and primarily for a purpose other than that of securing the proper discovery, joinder of parties or adjudication of the claim in which the proceedings are based; and
(2) the proceedings have terminated in favor of the person against whom they are brought.
42 Pa. C.S.A. § 8351(a). Accordingly, a cause of action for wrongful use of civil proceedings requires a plaintiff to allege and prove three elements: (1) the underlying proceeding was terminated in favor of the plaintiff, (2) the defendant caused these proceedings to be instituted without probable cause or with gross negligence, and (3) the proceedings were instituted primarily for an improper purpose.
At first glance, the first element, that the underlying action has terminated in plaintiff’s favor appears simple enough. However, as with most such apparently simplistic statements of law, there are a number of wrinkles to examine. Although Pennsylvania courts have only touched on the issue, courts in a number of other states have clearly stated that in order to be a “termination” for wrongful use of civil proceedings purposes, the end of the underlying case must at least reflect on the merits of the underlying case.
The termination need not be on the merits, the prior proceeding need only be consistent with the plaintiff’’s claim of no liability on its part. DiMassa v. U.S.F. & G., 8 Phila. 549, 552 (Phila. 1983) see also D’Elia v. Folino, 2007 PA Super 286, P12 (Pa. Super. Ct. 2007) (“it is clear that Appellant’s liability, or lack thereof, was never and can never be determined with finality. . . . [a]s such, Appellant was not the ‘victor’ in the underlying lawsuit, and he cannot, as a matter of law, prevail against Appellees in a wrongful use of civil proceedings suit.”).
The requirement that the termination reflect upon the merits of the action arises out of Restatement (Second) of Torts§ 674 (comment j), which states: “In determining the effect of withdrawal the same considerations are decisive as when criminal charges are withdrawn; and therefore §§ 660-661 and 665, and the Comments under those Sections are pertinent to this Section.” Restatement 2d of Torts, § 660, Comment a states: “Proceedings are ‘terminated in favor of the accused,’ as that phrase is used in § 653 and throughout this Topic, only when their final disposition is such as to indicate the innocence of the accused.”
A termination based on a defense which is merely procedural or technical in nature, and is in no way dependent on nor reflective of the merits in the underlying action, cannot qualify as a favorable termination. See, Alcorn v. Gordon, 762 S.W.2d 809, 812 (Ky. Ct. App. 1988); Wong v. Panis, 7 Haw. App. 414, 772 P.2d 695, 699 (Haw. Ct. App. 1989); Miskew v. Hess, 21 Kan. App. 2d 927, 910 P.2d 223, 233 (Kan. Ct. App. 1996); Palmer Dev. Corp. v. Gordon, 1999 ME 22, 723 A.2d 881, 884 (Me. 1999).
The Supreme Judicial Court of Maine explained the rational for this rule as follows:
Society does not want litigants who committed the acts of which they are accused, but who were able to escape liability on a “technicality” or procedural device, to turn around and collect damages against their accuser. This reason justifies a requirement that the favorable termination of the underlying proceeding be on the merits or, in some way, reflect on the merits.
Palmer, supra at 885.
In sum, it is not essential to maintenance of an action for malicious prosecution that the prior proceeding was favorably terminated following trial on the merits; however, termination must reflect on the merits of the underlying action. As noted above, the Pennsylvania courts have not yet fully embraced this concept, but appear to be receptive to it, and the precedent throughout the country is strongly supportive.